DAVID Cameron today denied that he had 'lost control' of the Tory party over the EU and warned that the worst thing the Government could do on the issue was to 'bury its head in the sand.'

The Prime Minister claimed the most dangerous thing for the Tory Party, despite divisions would be to "bury its head in the sand over the EU and not give the British people the choice to decide.

He added that it would be a disaster to just sit back and look on as changes take place in Europe because of the single currency and do nothing about it.

He claimed Labour would be the party that would do little to control the power in Brussels.

The Prime Minister was defending his stance on Europe after Labour leader Ed Miliband accused him of 'losing control' of the Conservative Party over the issue.

Mr Miliband warned that Mr Cameron's highly-anticipated speech Friday's speech would only result in a fresh round of Tory infighting on Europe and five years of uncertainty for businesses over the UK's position in the EU.

But Mr Cameron argued: "What is in Britain's interest is to seek a fresh settlement in Europe that is more flexible, more competitive. That is in our interest, that is what we will seek."

The PM is expected to announce plans for a referendum on a new settlement with Brussels after the 2015 general election.

Mr Miliband quoted Mr Cameron, who in his early days as Tory leader said one of the party's biggest problems was "they spend far too much of their time banging on about Europe".

He asked the Prime Minister if he was "glad those days are over".

Mr Cameron smiled at the question and responded: "I think that even the leader of the Labour Party should accept the fact that there is a massive change taking place in Europe, a change that is being driven by the changes in the eurozone.

"Frankly, this country faces the choice, and political parties in this country face a choice: do we look at these changes and see what we can do to maximise Britain's national interest, and do we consult the public about that, or do we sit back, do nothing and tell the public to go hang?

"I know where I stand, I know where this party stands, and that's in the national interest."

He challenged Mr Miliband to set out his position on the EU and the Labour leader called for a move from austerity to a focus on growth and jobs.

Mr Miliband added that Mr Cameron was changing his position on Europe "because he has lost control of his party".

"The problem is this: he thinks his problems on Europe will end on Friday. They are just beginning."

If you want to stay out of the single currency you vote Conservative

David Cameron

He asked Mr Cameron: "Can you confirm you have now given the green light to Conservative Cabinet ministers to campaign on different positions on whether they are for or against being in the European Union?"

Mr Cameron said the Labour leader was "completely isolated" in calling for a change in the approach to deficit-reduction across Europe.

He added that when Labour was in office the government "signed treaty after treaty, gave away power after power, saw more centralisation after more centralisation and never consulted the British people".

Looking ahead to the 2015 general election he said voters would have a "very simple choice".

"If you want to stay out of the single currency you vote Conservative, if you want to join the single currency you vote Labour.

"If you want to take power back for Britain you vote Conservative, if you want to give power to Brussels you vote Labour.

"That is the truth."

Mr Miliband, he claimed, wanted "no change" in the balance of power with Brussels and "he doesn't believe the British people should be given a choice".